Tech Talk from Pring

For sophisticated, technically-oriented investors, few
services are as detailed as InterMarket Review from
Martin Pring, featuring some 40 pages of charts, analysis,
and commentary on stocks, bonds, and commodities. Here’s some of his
latest.

"Even though we are cautious on
commodities, we continue to recommend a 10% allocation to the Pimco Commodity
Real Return Strategy Fund (PCRAX) because the Inflation Barometer is still bullish
and the Dow Jones AIG Commodity Index (on which the fund is benchmarked) remains
above its 200-day moving average. However, in view of the weakening technical
position of the commodity markets, we would liquidate the position if it
experiences a daily close below 140, since this would complete an intermediate
top, thereby tipping the balance of long-term technical evidence to the bearish
side.

"We remain bullish on Japan. The
Nikkei has managed to bounce off the neckline of a major reverse head and
shoulders pattern. At the moment, the long-term trend is positive and we think there is
a good chance that the short- and intermediate-term trends will soon trigger buy
signals thereby enabling the Index to move significantly higher form current
levels. We continue to recommend 10% allocation to Japanese equities, where the
chosen vehicle is the Japanese iShare (EWJ AMEX), as long as it remains above $9.00 on a Friday
close basis. A close this low would complete a head and shoulders top formation.
We are also recommending 5% to the Singapore iShare (EWS AMEX), since its the long-term technical position
has improved. The Singapore iShares look to be very strong technically, since
they have broken out in both an absolute and relative basis.

"Each month we introduce
several technically attractive looking stocks. Sometimes the stock will have broken out
and is an immediate buy, while others will need to be stalked for a short-term
correction. Finally, some may appear to be forming bases, but have not broken
out. Such stocks are recommended in anticipation of a breakout. Traders can buy
Baxter Labs (BAX NYSE) at $31.60 or above. More conservative
investors should wait for a breakout above $35.50. Calpine (CPN NYSE) should be bought by traders at prices above
$3.50 and by more conservative investors on a breakout above the $4.50 level.
Felcor Lodging (FCH NYSE) is a buy above $11.90 by traders and above
$12.60 by conservative investors. Valassis Communications (VCI NYSE) is a buy above $28.50 for traders, and above
$29.75 for conservative investors. Finally, CSX Corp. (CSX NYSE) and Union Pacific (UNP NYSE) can be considered by both traders and
conservative investors. CSX is a buy above $32.50 and Union Pacific is a buy
above $58.25."